What is the average cost of car insurance?

If you have a car, you’re going to need car insurance, but finding out the average price of insurance is tricky because not everyone agrees. According to the Association of British Insurers (ABI), the average cost of car insurance in the UK for comprehensive cover costs £485 a year.

But there are conflicting figures, with Statista, which collates statistics and studies saying that the average cost is a larger £692, and Confused saying that drivers are paying a whopping £827 on average and that premiums are likely to rise to £900 on average this year.

Your age is the most significant thing insurance companies use to give you a car insurance quote. This, along with where you live, the kind of car you drive and other factors, give potential insurers the valuable information about your driving and the likelihood that you will have a crash.

If these factors suggest you’re at a low risk of getting into an accident or getting your car stolen, you’ll get a cheaper quote.

Since quotes can vary significantly based on these factors, it can be difficult to know if you’re offered a fair rate or if you’re being ripped off.

Average cost of car insurance by age

According to Statista.com, the average cost of car insurance for those in their 20’s was the highest out of the age ranges with an average of £1,035.

The lowest average age group for car insurance in the UK was for those in their fifties with the average cost of £600. This doesn’t mean that the older you get, the cheaper your insurance gets though, as the price goes up again once you hit your 60’s.

Average car insurance cost by age:

Age

Average Price

20s

£1,036

30s

£832

40s

£692

50s

£600

60s

£687

These figures are an average of the quotes from a selection of major UK insurers and assume five years’ driving experience and five-year no claims discount.

Average cost of car insurance based on sex

We know what you’re thinking - you can’t discriminate based on sex anymore! Yet despite the EU directive which prohibits insurers from assessing a driver’s risk based on their gender, male drivers are still paying more on average than female drivers.

According to Confused.com, male drivers are edging closer to the £900 mark and are paying £878 on average for their car insurance - £114 more than female motorists who are paying £764 on average.

How to keep your car insurance costs low

One problem for drivers is that auto-renewing their policy and staying loyal to one insurer won’t necessarily make the premium cheaper.

In fact, last year it was revealed that drivers who auto-renew their premium are missing out on almost £300 of savings by not swapping insurer.

It’s also worth noting that cheap car insurance is not necessarily the best car insurance for you. But that said, there are things you can do which will lower the odds of you looking like a risky driver in the eyes of insurance companies and get yourself a cheaper deal.

We have a guide which has a full list of tricks and tips to get the best deal on your car insurance, but ideas include making your car more secure, drive a make and model car from a low insurance group, be accurate about your mileage, drive safely and add a second driver.

Why is car insurance so expensive?

The amount you pay depends on a lot of things, including the reasons above but, prices are rising across the board considerably. MoneySupermarket said that the simple reason for this is because the cost of claims is high. Insurers therefore increase premiums to make sure they make a profit.

Unfortunately, many car insurance claims are fraudulent and its honest motorists who end up footing the bill. According the Association of British Insurers, the insurance industry detected 1,250,000 cases of fraudulent claims in 2016 worth a staggering £1.3 billion.

Whiplash claims – There are about 1,500 whiplash claims every day in the UK. These claims cost the industry about £2 billion a year, adding £90 to every driver’s annual car insurance premium.

Referral fees - When there is an accident, details are often sold on by car insurance companies to personal injury lawyers, which lead to the increase in compensation claims. The government plans to ban referral fees, which might lead to less of a compensation culture and lead to a fall in premiums.

Uninsured motorists - There are over one million uninsured motorists on the UK’s road, which is a problem for many reasons, but also because they ramp up insurance costs for those who do pay - as the insurance industry still has to cover the cost of any injury or damage to a person or car in the event of an accident.